Computational Complexity and other fun stuff in math and computer science from Lance Fortnow and Bill Gasarch

Thursday, August 18, 2016

Predicting in Changing Environments

The New York Times yesterday ran a story connecting climate change to the Louisiana flooding.

The National Weather Service reports that parts of Louisiana have received as much as 31 inches of rain in the last week, a number Dr. Easterling called “pretty staggering,” and one that exceeds an amount of precipitation that his center predicts will occur once every thousand years in the area.Dr. Easterling said that those sorts of estimates were predicated on the idea that the climate was stable, a principle that has become outdated.The third National Climate Assessment, released in 2014 by the United States Global Change Research Program, showed that “the amount of rain falling in very heavy precipitation events” had been significantly above average since 1991.However, the research did not identify the South as one of the areas of greatest concern; the increase was found to be greatest in the Northeast, Midwest and Upper Great Plains regions of the United States.

In short climate change means our old prediction models of the weather no longer apply. On top of that, new models that tried to take into account climate change predicted heavier rains but not in that area of the country.

Did he have a 1 percent chance to win when he descended the escalator of Trump Tower last June? Twenty percent? Or should we have known all along?Was Mr. Trump’s [republican nomination] victory a black swan, the electoral equivalent of World War I or the Depression: an unlikely event with complex causes, some understood at the time but others overlooked, that came together in unexpected ways to produce a result that no one could have reasonably anticipated?Or did we simply underestimate Mr. Trump from the start? Did we discount him because we assumed that voters would never nominate a reality-TV star for president, let alone a provocateur with iconoclastic policy views like his? Did we put too much stock in “the party decides,” a theory about the role of party elites in influencing the outcome of the primary process?The answer, as best I can tell, is all of the above.I do think we — and specifically, I — underestimated Mr. Trump. There were bad assumptions, misinterpretations of the data, and missed connections all along the way.

We also had bad predictions on Brexit and one factor in the 2008 financial crisis was a heavy reliance on historical patterns of housing prices.

We have at our fingertips incredible prediction tools from machine learning models to prediction markets. Not all things change, our models trained to recognize cat pictures will continue to recognize cat pictures for a long time running. But as we continue to rely more and more on data driven predictions and decisions, be prepared for more and more surprises as underlying changes in the environmental, political and financial climates can pull the rug out from under us.